SE Asian stocks rise on hopes of trade deal deadline extension, monetary policy easing

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BENGALURU (Feb 20): Southeast Asian stock markets closed higher on Wednesday, with Philippines leading the gains, on hopes of an extension to the deadline for a US-China trade deal, and expected easing in monetary policies in the region.

US President Donald Trump said on Tuesday that trade talks with China were going well and suggested he was open to pushing off the deadline to complete negotiations.

Tariffs on US$200 billion worth of imports from China — Southeast Asia's biggest trading partner — are scheduled to rise to 25% from 10% by March 1 if the world's two largest economies do not settle their trade dispute.

Also, a slowing global economy and increasing strain on businesses from a year-long Sino-US trade war are tilting central banks from Japan to Australia towards monetary easing in a remarkable 180-degree turn.

With the US Federal Reserve releasing minutes of their meeting later on Wednesday, expectations of Southeast Asian nations easing policies amid a dovish Fed, boosted investor sentiment.

The Philippine index led gains in the region, ending 1.4% higher, driven by industrial and real estate stocks. SM Prime Holdings Inc and Ayala Land Inc rose 3.3% and 2.1%, respectively.

Deputy governor of the Philippine central bank Diwa Guinigundo said on Tuesday the bank will act swiftly if it judges there is not enough liquidity in the financial system to maintain economic momentum, leading economists to expect some form of monetary easing.    

The Malaysian benchmark gained over 1% on the back of material and consumer stocks.  

Malaysia's Petronas Chemicals Group Bhd rose 2.8% after Spanish oil and gas firm Repsol said the company with its partners — Petronas and MOECO — discovered gas resources in Indonesia.

The country's January consumer prices are expected to fall, the first decline in nearly a decade, amid a drop in domestic fuel prices, according to a Reuters poll.

Singapore's index closed at its highest level in more than six months, boosted by utilities and telecom stocks.

Shares of Capitaland Ltd rose to an over five-and-a-half-month closing high, after recording a 71.2% surge in fourth-quarter profit and the highest annual profit in a decade.

Indonesia and Thai indexes firmed 0.3% and 0.6%, respectively, while the Vietnam benchmark gained 0.7%.

Change on the day

Market                 Current   Previous close  % move
Singapore              3278.38   3259.8          0.57
Bangkok                1645.38   1635.71         0.59
Manila                 7939.24   7833.75         1.35
Jakarta                6512.784  6494.667        0.28
Kuala Lumpur           1726.18   1706.56         1.15
Ho Chi Minh            970.58    964.35          0.65

Change so far in 2019

Market                 Current   End 2018        % move
Singapore              3278.38   3068.76         6.83
Bangkok                1645.38   1563.88         5.21
Manila                 7939.24   7,466.02        6.34
Jakarta                6512.784  6,194.50        5.14
Kuala Lumpur           1726.18   1690.58         2.11
Ho Chi Minh            970.58    892.54          8.74